The latest Farmland Tax Assessments felt like twisting a knife in the gut of Shelby County farmers. State Rep. Brad Halbrook, R-Shelbyville, and the Illinois Farm Bureau responded on Monday to try to explain the bigger picture.
The most recent farmland tax assessments were sent out and appeared in the Shelbyville Daily Union Newpaper on October 25. Halbrook received several phone calls from concerned taxpayers. He contacted the Farm Bureau to help respond.
“I was getting phone calls, so I called the Farm Bureau and was able to get an expert, Brenda Matherly, the Director of Local Government for the Farm Bureau, in Bloomington, to come.
Within 2 weeks a meeting was arranged and announced. It was held on Monday, Nov. 18 at the Lake Shelbyville Visitors Center. The room held 100 seats and was packed.
For farmers having an extremely difficult year, increased tax assessments added insult to injury. If there had been a bumper crop this year, the sting would no have been so bad.
Spring rains caused farmers to replant and some to leave ground fallow. The harvest is a month late and yields are not encouraging. As some farmers were just now finishing up an anxious harvest, the tax assessments came out.
Matherly spent an hour and half, walking the crowd through the history of the farmland assessment, unfolding the cause for the current pain and explaining why it is necessary.
Because of well-meaning, but short-sighted farmland assessment legislation 30 years ago, the system is now going through a correction. That correction is causing a strain. However, without the painful correction, the result could be fatal for farms.
Illinois uses a certified value to assess farmland. The land is taxed only on its potential to produce. Different qualities of soil are therefore taxed at different levels because their potential to produce is different.
A previous method was to tax farmland based on its market value, what it would sell for. As farmland was bought up for non-agricultural development, its market value shot up.
Farmland that is taxed based on market value significantly raises the taxes on that land, putting pressure on the farmer to sell to developers, or pay a much higher tax on their farmland. The certified value is much fairer to farmers who want to continue farming.
However, the farm economy was bad in the 1980s. Legislation in 1986 tried to protect farmers from wild fluctuations. They passed a law to limit the tax assessments to no more than a 10% swing in either direction.
Over the years the poorer soils caught a bigger break than the higher producing soils. According to Matherly, a disparity of tax increase to the better soils went from 2 to 1, to 40 to 1 and were on their way to 60 to 1.
Matherly said that situation threatened a constitutional challenge to the certified value assessment. If the certified value assessment was thrown out, the market value assessment would kick in and explode the tax rate for farmland.
Matherly said new legislation tried to correct that disparity and hold off a constitutional challenge. The annual increases in the assessments of farmland will continue every year, despite what the profit for a particular year may be. It is hurting the poorer soil more than the better soil, so as to close the gap and avoid blowing up the system.
What can farmers or county tax assessors do about the situation? According to Matherly, they can’t do much. County tax assessors are bound by state law. Farmers appealing to the state, according to Matherly, won’t see much change in the assessment and the cost to pursue the change is extremely high for little return.
What Halbrook and Matherly stressed was for farmers to take what responsibility they do have and go to the county and get their cards that show the value of their land. If those cards are inaccurate, they can talk to the county assessors and get it corrected and save money on their taxes.
County Clerk Jessica Fox, County Treasurer Erica Firnhaber, and Shelby County Tax Assessor Debbie Dunaway, were all on hand at the meeting and were available and willing to answer any questions.
The appeal deadline for this year is Tuesday, Nov. 26. Halbrook said that even if a farmer cannot get it corrected for this year, a farmer can get it corrected going forward.